Asian rice export prices dropped this week on soft demand among African buyers and rising supply, despite the Philippines' plan for a fresh purchase this quarter, traders said on Wednesday. The Philippines, one of the world's biggest rice importers, plans to buy 250,000 tonnes of its food staple from either Vietnam, Thailand or Cambodia, with deliveries slated within the current quarter.
There's no clear date for the Manila tender and it's uncertain whether bulk of the supply can come from Vietnam, said a trader at a foreign firm in Ho Chi Minh City. "While overall buying demand is weak, so prices are still stable," the trader said. The 5-percent broken, summer-autumn rice slipped to $355 a tonne, free-on-board (FOB), from $360-$365 a week ago, while 25-percent broken rice, often sought by the Philippines, was unchanged at $335-$340 a tonne.
Buyers in Africa were waiting for Thailand's next rice auction, which could offer cheap grain, traders said. Thailand, the world's second-biggest rice exporter after India, sold 347,500 tonnes from state stockpiles in two July auctions, or 9 percent of the 3.81 million tonnes on offer. Another auction is expected this month. India, Thailand and Vietnam together supply around 60 percent of globally traded rice.
Thai benchmark 5-percent broken rice narrowed to $415-$423 a tonne, FOB basis, from $410-$432 last Wednesday. "Prices might sink further as supply rises," a Thai trader said, adding that fresh supply will arrive this month and in September. In India, thin African demand and expectations of a bumper summer crop pushed down prices slightly, traders said.
"Demand from African countries is weak right now and it may remain subdued for the next few weeks," said an exporter in Kakinada in the southern state of Andhra Pradesh, adding that 2016/2017 output could rise on larger planting area and good rain. Prices for India's 5-percent broken parboiled rice slipped to $380-$390 a tonne, FOB basis, from $381-$391 last week. Indian farmers have planted 28.2 million hectares of rice as of August 5, above the 27.61 million hectares planted in the same period a year ago.